Precisely as of 2014, the increase in public spending began disproportionately, with the increase in ministerial payrolls, the financing of the "Social Missions" (which are nothing more than instruments of ideologization) and the massive importation of finished products that previously they were covered by internal production.
A chain of Government errors that lasted for more than 6 years in the application of macroeconomic policies, are bearing fruit.
In 2017 The Venezuelan Economy is Officially Declared in Hyperinflation.
Despite this, the policies continued to be wrong, accelerating the deterioration of the productive system and the fall of the Gross Domestic Product.
Inflation rates began to grow exponentially with the issuance of "Inorganic Money", thus expanding the money supply without having assets or services to support this new currency, which is not even physically printed.
Image Source
In her article Is $ 200 a lot of money in Venezuela?
by @celi130, my fellow countrywoman said the following:
Price of a basic Family basket
1 $ equals 690,000 Bs.F
Venezuelan worker monthly salary 400,000 Bs F. equals $ 0.531 Kilo milk 6.7 $
1 Kilo cheese 3.2 $
1 egg carton 2.8 $
1 Kilo of pasta 1.5 $
1 kilo of rice 1.2 $
1 kilo of precooked flour 1.3 $
1 Kilo of meat 4.5 $
1 kilo of fish 3.2 $
1 kilo of wheat flour 1.2 $
1 willow $ 2
1 mayonnaise 2.5 $
1 coffee (200grm) 1.2 $
1 kilo grains 2 $
1 kilo of sugar 1.2 $
1 liter oil 1.9 $
Fruits, vegetables and vegetables $ 10Giving a total of 46.4 $, for a week, this amount of food for a family of 4 people (father, mother and two children) that is equivalent if both parents work earning a minimum salary that equals 0.53 $, would be 1.06 $ . What does the Venezuelan buy with that salary, not even for breakfast a day.
Cumulative inflation so far in 2020 is 2,000%.
It's not just Government Policies
As we could see, bad fiscal policies and uncontrolled public spending show the genesis of these critical levels of hyperinflation and economic decline, but the elements of the Venezuelan social crisis also directly influence the rise in prices.
The almost total uselessness, due to the fall in its real value, of the national currency (the Bolivar), has pressured citizens to buy dollars, a fact that in turn detracts from the local sign.
There is no stake in Bolivares
Like in Blockchain protocols, where accumulating a stake of a token demonstrates the trust of users and this, in turn, revalues said tokens, the value of Fiat currencies also depends to a great extent on the trust that its users place in it.
In this way, we can find investments and large contracts that are signed and established in dollars.
If in Venezuela contracts were established in national currency, if Venezuelans had savings capacity and in bank accounts, the "Stakes" of the users were deposited, confidence in the currency could be retaken and in this way, its revaluation could materialize.
But when everyday money loses value exponentially and at the same time, users quickly get rid of this currency (rapidly increasing spending), what is generated is a greater devaluation that causes hyperinflation to increase.
@juanmolina
About Us
JOIN OUR Discord
Web Site | Telegram | Discord | Instagram | Twitter | Facebook | Youtube
Posted Using LeoFinance Beta
It's scary to read how a government can collapse a country in such a short period of time. I'm no expert in Venezuela, but I guess the country was kinda well functioning before the switch of governance.
Posted Using LeoFinance Beta
We were a flourishing nation.
The damage caused in the last 20 years of "Revolution" is irreparable. The deterioration is at all levels: social, economic, cultural.
Totally sad our reality.
Posted Using LeoFinance Beta
1965 Silver Venezuelan 2 Bolivar, Approx $6.06 USD in Silver value today.
Posted Using LeoFinance Beta
Many of our grandparents still have these patterns.
There are also those of Silver 5 Bolivares.
Posted Using LeoFinance Beta
My friend, in these two issues that you have already published, you express a reality that surrounds all of us Venezuelans. I am sorry to tell you that at this moment, these amounts have already changed again.
I am asking how we can get out of this terrible situation, which the government itself is promoting with its communist economic policies, but only for the citizens; for them it is something totally capitalist.
@tipu curate
Upvoted 👌 (Mana: 135/150) Liquid rewards.
The protagonists of the dictatorial regime in Venezuela claim to be socialists, but with all their actions they show that they are inveterate lovers of the purest capitalism.
It is they who have accumulated incalculable fortunes, own companies and properties all over the world. Hidden capital in foreign banks. Testaferros to be able to hide everything.
When will we get out of this? That moment is really uncertain.
Posted Using LeoFinance Beta
Es una verdadera pena la situación que están pasando en tu querida Venezuela! Lamentablemente en la mayoría de los pueblos sudamericanos estamos sometidos a una realidad que es muy mala para la mayor parte de la población. En Argentina no llegamos a los extremos en el que está tú país pero la situación es realmente muy compleja
Posted Using LeoFinance Beta
Así es, la situación es muy compleja, tanto en Venezuela como en Argentina.
Espero que con mis publicaciones, las peronas de otras latitudes puedan tener una idea mas cercana a la realidad Venezolana.
Posted Using LeoFinance Beta